Navistar sued again in ongoing engine dispute

Two suburban school bus companies sued Navistar in a case that largely mirrors the Lisle manufacturer's legal woes with trucking customers.

Navistar "actively, fraudulently" concealed malfunctioning emissions systems and automatic brake problems in 40 buses it sold to plaintiff Polar Express School Bus in Palos Heights, according to a complaint filed in Cook County Circuit Court. (Read the lawsuit below.)

Polar Express School Bus leased the buses to Bellwood-based Lakeview Bus Lines, also a plaintiff. Lakeview Bus ferries children to schools in Chicago, the western suburbs and throughout northern Cook County.

Navistar, a major producer of trucks, buses and military vehicles, is facing a slew of litigation stemming from the allegedly defective exhaust gas recirculation emissions control system of its MaxxForce engine.

The tally includes 40 lawsuits in state courts and a multidistrict class-action lawsuit in federal court in Chicago. In August, a Tennessee jury hit the company with a $31 million verdict, including $20 million in punitive damages, after it found that Navistar committed fraud.

The company, which plans to appeal the verdict, reported $8.1 billion in revenue in 2016. But Navistar said in a recent Securities & Exchange Commission filing that it cannot "provide meaningful quantification of how the final resolution of these claims may impact our future consolidated financial condition."

Polar Express and Lakeview Bus confronted the same basic issues as the trucking companies, just with a smaller engine designed for buses, and the additional problem of poor brakes, said their attorney, Bruce Rose.

The bus engines were designed and tested at Navistar's facility in Melrose Park, the lawsuit says. Around 2003, the facility's engine group tested and re-tested "dozens, if not scores, of railroad car-loads" of engines that the bus companies returned after they failed.

The lawsuit says Navistar's defective engines went into buses purchased by other Illinois school bus companies like Sunrise School Bus & Charter Services and Alpha School Bus, as well as buses in Detroit and Atlanta.

"After testing was completed, the engine group later shipped those failed, defective engines back out . . . to be melted down, thereby destroying the evidence . . . of the true facts concerning Navistar's defective (emissions) system," the lawsuit says.

The lawsuit was filed seven months after Polar Express and Lakeview Bus dropped a lawsuit filed in U.S. District Court alleging racketeering at the Lisle company.